KRS 304.15-260: Limitation of liability.

(1) No policy of life insurance shall be delivered or issued for delivery in this state if it

contains any of the following provisions:

(a) A provision limiting the time within which an action at law or in equity may

be commenced on such a policy to less than three (3) years after the cause of

action has accrued; or

(b) A provision which excludes or restricts liability for death caused in a certain

specified manner or occurring while the insured has a specified status, except

that a policy may contain provision s excluding or restricting coverage as

specified therein in the event of death under any one (1) or more of the

following circumstances:

1. Death as a result, directly or indirectly, of war, declared or undeclared,

or of action by military forces, or of an y act or hazard of such war or

action, or of service in the military, naval, or air forces or in civilian

forces auxiliary thereto, or from any cause while a member of such

military, naval, or air forces of any country at war, declared or

undeclared, or of any country engaged in such military action;

2. Death as a result of aviation or any air travel or flight;

3. Death as a result of specified hazardous occupation or occupations;

4. Death while the insured is a resident outside the continental United

States and Canada; or

5. Death within two (2) years from the date of issue of the policy as a result

of suicide, while sane or insane.

(2) A policy which contains any exclusion or restriction pursuant to paragraph (b) of

subsection (1) of this section, shall al so provide that in the event of death under the

circumstances to which any such exclusion or restriction is applicable, the insurer

will pay an amount not less than a reserve determined according to the

commissioners reserve valuation method upon the basis of the mortality table and

interest rate specified in the policy for the calculation of nonforfeiture benefits (or if

the policy provides for no such benefits, computed according to a mortality table

and interest rate determined by the insurer and specifi ed in the policy) with

adjustment for indebtedness or dividend credit.

(3) This section shall not apply to group life insurance, health insurance, reinsurance, or

annuities, or to any provision in a life insurance policy or contract supplemental

thereto relating to disability benefits or to additional benefits in the event of death

by accident or accidental means.

(4) Nothing contained in this section shall prohibit any provision which in the opinion

of the commissioner is more favorable to the policyholder than a provision

permitted by this section.